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greenpeace Greenpeace, a non-governmental campaigning organisation focused on environmental issues, announced it would begin accepting bitcoin donations last month, becoming the latest not-for-profit group to embrace the digital currency. The move, which followed a similar announcement by United Way, is especially notable because Greenpeace does not accept donations from governments or corporations – it relies largely on small donations from the public. CoinDesk spoke with Greenpeace chief information officer Tom Camerlinck, who explained that there were many “practical things” that motivated the organisation to adopt bitcoin into its fundraising efforts – things like lower transaction fees, the privacy of its donors and having a payment channel that allows the fraud and security team to worry less. Camerlinck explained to CoinDesk that due to the nature of its donor base, the organisation strives to diversify and add different communities into the mix of people that funds its work. “We like to stay nimble and go after what we see is the next major thing that’s going to make the biggest difference,” he said. In learning about bitcoin, though, it became evident that the community values seemed very much aligned with those of Greenpeace, he said, citing privacy as a frequent concern of its donors as well as independence, free speech, sustainability and “taking chances on innovation”. Fighting corporations When asked why Greenpeace chose BitPay as its payments processor, Camerlinck said: “We are Greenpeace and part of our independence is that we don’t tend to promote corporations because we spend a lot of time fighting corporations.” He made no mention of BitPay’s competitors; namely Coinbase, whose merchant base includes corporate giants like Dell, Dish Network, Expedia and PayPal. He added: “Independence is really important to our donors and our supporters. They understand that money can directly or indirectly influence campaigns or actions of nonprofits. […] That’s important to our independence.” Referring to the organisation’s goals of net neutrality, privacy, free speech and anti-government spying, Camerlinck said that free speech is an especially serious issue for Greenpeace. “We take our free speech pretty seriously and we exercise our free speech quite a bit and its part of our campaign style,” he said. “I think that’s where a lot of the overlap is.” Not excluding Greenpeace’s environmental focus, he concluded: “There’s the sustainability issue. The environment is everyone’s issue. We’re going to have an overlap if you live on this planet.” Beginning steps Greenpeace has many ongoing projects in countries and regions that many would argue have a much greater use case for bitcoin than the US and other developed areas. Right now, bitcoin fundraising is available only in the US due to the structure and separation of its regional operations. While there isn’t a worldwide donation page, Camerlinck said he “would encourage” its other regional divisions to follow the US’ lead on bitcoin integration. “If there’s an opportunity to do something innovative and be one of the first out of the door – anything that’s going to get more money for the mission, more people on the streets making change and doing good for the environment – we try to do that.” Greenpeace doesn’t do a lot of directed donations, so any they do receive in bitcoin will go to its general fund, which Camerlinck explained is to avoid having money tangled up in various reserves when it needs access to it. For the time being, the organisation will convert all bitcoin funds back into dollars. Joking that Greenpeace sometimes takes liberties with the law, Camerlinck explained that it is very conservative about its internal financial dealings and isn’t ready to commit to bitcoin beyond its current engagement. Disclaimer: CoinDesk founder Shakil Khan is an investor in BitPay. Images via Greenpeace CharityGreenpeace
Original author: Tanaya Macheel

A year on from the arrest of Silk Road’s alleged founder, CoinDesk takes a look at the life of Lyn Ulbricht, mother of accused Silk Road leader Ross Ulbricht. Silk-Road-Article-Banner-v3 For Lyn Ulbricht, mother of alleged Silk Road ringleader Ross William Ulbricht, it’s been an intense year. It’s 1st October 2014, 365 days after her son was taken into custody by federal agents at a San Francisco public library, brought to prison and paraded on magazines. To Lyn, the day is the dawn of a different lifetime. One year later, Lyn is upbeat, sounding energetic at times, exhausted at others, prone to long sighs though open to occasional laughter when talking about her life, her son’s case and his trial set to begin on 10th November at 500 Pearl Street, New York. It’s then that the months of legal back and forth, the filings and motions that have punctuated the last year will all come to a close. Her son will face a trial that could end with a maximum life sentence for crimes the US government alleges he committed while operating Silk Road, a now-infamous online black market that earned millions from 2011 to 2013, all through a then-largely unknown digital currency – bitcoin. Still, Lyn is optimistic. She has just sent a $1,500 payment to “the lawyer”, Joshua Dratel. She says this most recent payment had left her with $62, which underscores just how much of a difference the donations to her son’s support effort, FreeRoss.org, have made. She’s thankful for Dratel at these times; he came highly recommended and is working at flexible rates. She talks passionately about the case, the latest statements from the FBI, the questions about how it acquired evidence, the struggle of caring for a son who is currently residing in New York’s Metropolitan Detention Center. She hopes that the case won’t go to trial, that there will be some “miracle”, that despite the bad breaks at every turn, the case will be dismissed at an evidentiary hearing. “I’m not looking forward to the experience of it at all,” Lyn told CoinDesk. Lyn speaks firmly when necessary, like when distancing herself from the Silk Road website, the source of all the strife. “It’s easy to get caught up in the sensationalism and the controversy around Silk Road, and I certainly don’t defend Silk Road,” she says. “I have no interest in that.” She worries about the case, about whether Ross is getting enough food, about where the money will come from for his legal expenses. “I’m concerned that it’s coming up so fast that Ross won’t have the evidence he needs to get a proper defense and a fair trial. And they apparently are coming out with new discovery, terrabytes worth … in fact I think it’s three,” she says. “It’s a lot,” she adds. The phrase will come up often in discussion. The next time we talk, that estimate doubles. Ulbricht The bigger story What Lyn most wants to talk about is the case – how it’s about privacy, it’s about precedent. She believes, as the defense has asserted, that her son’s conviction will threaten Internet freedoms. Throughout the interview, Lyn runs through the litany of alleged issues with the government’s claims against her son. She points to the reaction from the Internet community and an article in WIRED, both of which suggest that the FBI’s claims regarding how it obtained evidence don’t add up; that at the very least, explanations are needed. She references the Mutual Legal Assistance Treaty (MLAT), how the government said it obtained warrants through such means, only to later add a curious footnote. The US, the prosecution said, does not have an MLAT with Iceland, the supposed location of the Silk Road servers and the country that helped end Silk Road’s reign as the Internet’s leading black market. Then there’s the matter of the recent court cases, like Riley v California, that she says have been ignored. That case, ending on 25th June, found that police must obtain a warrant before searching cell phones. “Not being a lawyer myself, I’m kind of unqualified to get really into it, there’s a lot here,” she adds. All of it has been core to her belief that, regardless of her son’s involvement, his case matters to everyone; that it’s as big as the digital age itself, and will prove crucial to deciding essential and still undecided interpretations in US law. “There’s a lot of constitutional abuse happening here, a lot of questions here about the constitutionality of their investigation and prosecution, and that, to me, is the bigger story,” Lyn says. Obstruction of justice For Lyn, the case has been an eye-opener. While she says she hasn’t exactly been a fan of the government over the years, she’s been alarmed at the actions it has taken against Ross, who she maintains has been unfairly accused of using the alias Dread Pirate Roberts to run Silk Road. “I find it very alarming and upsetting to think this is our government and this is how they operate. I really honestly had no idea how prosecutorial misconduct could occur and how they really obstruct justice. I feel that if they want to play fair and they have a case, and we have a case, we can have a fair trial, but they don’t play fair as far as I can see,” she says. Lyn views her son’s case as an example of expanding government power, of just how easy it is to be accused of a crime in America. “No one knows how many crimes are actually on the books, that is an unknown number. I’ve tried to find it. It’s so many they don’t even know how many. So, it’s pretty easy to be accused of one. It’s kind of an alarming reality because that means there’s hugely expansive government power and they’re making more people criminals.” Ross, she asserts, is proof of how the system really works, of how an unconvicted, non-violent person with no prior arrests can be jailed for a year without bail. “I wasn’t quite as aware as I am now,” she adds. The kindness of strangers Lyn takes an active interest in the FreeRoss.org, blogging updates in the case, visiting rallies and conferences, tweeting pictures of supporters and chastising reporters on social media. “You wouldn’t believe how many times I have to get on Twitter and track down the writer. You have to use alleged, nothing is proven,” she says, adding that she was herself a journalism major at the prestigious University of Missouri and a freelance writer. The donations, she says, are needed. Most of the contributions are in bitcoin, with the largest donor being bitcoin investor Roger Ver. The Tokyo resident and bitcoin enthusiast launched a Twitter campaign in support of FreeRoss.org this July, promising to donate $10 for every retweet a campaign message received. Ver has donated $70,000 to the campaign to date. Lyn says she hopes to meet Ver someday, so she can thank him personally. “He’s been so supportive and so innovative the way he’s done it,” she says of Ver. The rest of the money she says has come from largely unknown donors. But, she’s grateful for the supporters, whoever they are. She maintains that Ross needs a high caliber defense, especially given the magnitude of the case and its implications in Internet law. To date, FreeRoss.org indicates the campaign has raised more than $185,000 toward its $250,000 goal. “The trial baseline cost is $35,000 a week for the defense, even with Roger’s contribution, which is fantastic, it’s a lot of money,” she notes. Lyn also downplays the rumors that she somehow benefited from the 144,000 BTC seized by the government that Ross has asserted he obtained lawfully. “I believe that Ross was into bitcoin for quite a while, so it’s very possible to me that it’s legitimate,” she says. “A lot of people confuse the Silk Road bitcoin and the bitcoin that the government says is on his laptop. Those are two different things.” Still, she says that even though her son was an early adopter of the technology, the family never benefitted from his investments. “He never gave me any bitcoin,” she jokes, adding, “There’s no big money somewhere. I wish there was.” A full-time job, a different life Lyn says that helping Ross is now her primary focus. Lyn and her husband Kirk, she notes, have relocated to the Northeast, though she declines to say where, to be closer to Ross, moving from the house they were renting in Austin, Texas. Kirk remains focused on the family business, a Costa Rican vacation rental complex called Casa Bambu that now has four rentals, the most recent added in 2007. Lyn says she wants to write a book when this is over, that she’ll need to tell her story. She jokes that she’s homeless now, but with a storage unit; that she still misses Texas, even more so in the winter. As for extended family and friends, Lyn says they speak to Ross and support him when they can, and that they visit often. In addition to Kirk, Ross has a half-brother and sister, though his sister lives in Australia, making communication difficult. Ross still has no access to email, but regained phone privileges in November. Before then, things were more difficult. “We were trying to set up a thing where he was on speaker phone and [his sister] was on speakerphone, and holding the phones up so he could hear her,” she recalls. A year with no weather New York's Metropolitan Detention CenterLyn is set to visit her son on Tuesday, a trip she makes every week or two, though she she says she makes it a point to talk to Ross more regularly. He has his good days and his bad days, though they’re exaggerated by the circumstances. On her last visit, she was able to stay for an extra hour, due to the kindness of the corrections officers. These little experiences, she says, have kept her faith up. Ross is working all day, everyday going through the evidence for the case with the hopes of clearing his name. As for what this process entails, Lyn is less specific. “I don’t really get informed about the details of the case,” she says. “I know that part of it is all his emails, his Facebook but then there’s a bunch of stuff from Silk Road.” But, it’s the little things that make his life challenging. Lyn laments that her son, a known nature-lover, hasn’t been outside for a year. “I think that’s been really hard on him, not being able to be outside,” she says. “These little things we don’t think about, like weather. I try never to complain about the weather because I think, ‘Oh Ross would love to be outside in this weather’.” “No matter what it is,” she says, “it’s weather.” She’s proud, too; that Ross has made friends, that he’s made an impact on other inmates, that he feels he’s growing from the experience. Lyn sounds, in these moments, like any American mom – her son away to college, interning in the city, abroad for the semester. The only difference is, for now, her son is still locked away in a tall, gray and brown building in Brooklyn. “Not exactly cozy,” she says. This article is part of CoinDesk’s Silk Road: One Year On series. Keep checking back for new additions to the series. Images via FreeRoss.org Ross UlbrichtSilk Road
Original author: Pete Rizzo

globaltravelbitcoin Though undeniably popular with its ardent supporters, bitcoin is arguably still searching for a practical application that makes it indispensable to mainstream users. That doesn’t mean there aren’t real use cases for bitcoin that could bring the kind of payments revolution many in the industry are hoping to achieve, though. Being both digital and decentralized, bitcoin is already a globalized electronic currency that operates across international borders. These traits are a key reason why many believe the first true killer application for bitcoin will be travel, and mainstream businesses like CheapAir and Expedia seem to agree. All over the globe countries use different currencies, with banks and currency exchangers taking profits from each transaction. While small, these add up to real costs for everyday travellers and the travel industry itself – costs that bitcoin could help alleviate. Alan Safahi, CEO of payments company ZipZap, allows his company’s consumers to convert cash into bitcoin. A seasoned traveler, Safahi told CoinDesk he believes in the potential bitcoin has for globetrotters: “You can plan your travel all around bitcoin. It’s a really good use case for travel.” Market in need of solutions Of course, while bitcoin may have real benefits, it’s important to try to quantify just how big of an impact it could have on the travel industry, and how specifically the technology might be able to lead to improvements. Research firm IBISWorld has found the global tourism market brings in more than $1tn in revenue for over 1.6 million travel-related businesses. Further, travel is also a growing global industry that has not neared its peak. The market for travel in Asia will be huge in the coming decades. Source: Market RealistThe market for travel in Asia will be huge in the coming decades. Source: Market RealistStill, currency is a constant issue for those who travel internationally, and thus travel companies that provide solutions could win customer loyalty by improving the experience for users. “I travel all over the world, and every time I go somewhere the first thing I do is go to an ATM and get some cash. And one out of 10 maybe works,” said Safahi. The byzantine banking network around the world is another part of the problem. With so many payment processors and networks, it’s almost impossible for ATM networks to cater to every single consumer card, and as a consequence, just as difficult for travel businesses to serve these customers at a low cost. Bitcoin ATMs provide essential infrastructure Bitcoin ATMs may be able to alleviate this issue by allowing travelers to go across borders with just one currency – bitcoin – before withdrawing local fiat at a low cost wherever they need it. Safahi sees the potential for bitcoin ATMs in international locations, such as airports, train stations and other hotspots for travelers. He said that if bitcoin ATMs were ubiquitous, this would be the likely scenario for a traveler: “Go to a bitcoin ATM, scan [a] phone. Then have a map on their phone that shows every business that accepts bitcoin.” Though it is becoming more convenient, it’s not exactly simple to live off of just bitcoin, which is what makes traveling with only the digital currency problematic. Roger Ver, a digital currency evangelist well-known for living on bitcoin, told CoinDesk: “With more and more bitcoin ATMs popping up around the world, I think it is just a matter of time until we see companies like Travelex or other money changing business adding bitcoin to the list of currencies they exchange.” Bitcoin ATMs are popping up all over the world. Source; CoinDesk Bitcoin ATM MapBitcoin ATMs are popping up all over the world. Source; CoinDesk Bitcoin ATM MapAlternative to unstable fiat currencies Another problem for the travel industry is the diversity of currencies used around the globe. Wikipedia lists roughly 180 circulating currencies in 193 of the countries recognized by the United Nations. Here, bitcoin could offer stability where local currencies fall short. ZipZap’s Safahi told CoinDesk there are a number of countries that are far behind in regard to digital commerce and payments, and bitcoin may have an opportunity to become widely used in those markets. For example, Safahi says in places like Iran, people still book travel through a travel agency, paying cash. Credit cards are not widely used in many places. Source: University of British ColumbiaCredit cards are not widely used in many places. Source: University of British ColumbiaAnother example is Argentina, where the Argentine peso has been so problematic that a growing number of citizens believe bitcoin might be a better alternative. That’s why Sebastian Serrano of BitPagos, which allows hotels and restaurants to convert local fiat payments into bitcoin, is already doing business in Latin American countries like Argentina. “In countries with high capital controls like Argentina or Venezuela, the exchange rate difference would be substantial and once you convert to the local currency is not possible to convert it back to the foreign currency,” Serrano said. Ver pointed out how much easier traveling with bitcoin will be going forward, given the progress being made so far: “We’ve already seen Square announce [planned] bitcoin integration. Soon, I think we will see major POS companies integrate bitcoin into their systems. Once that happens, I suspect most people would prefer to use bitcoin.” “Bitcoin will become the world’s currency,” Ver added. Disrupting currency spreads There is also the matter of bitcoin’s ability to compete against existing solutions. Today, it’s common for people from the developed world to use credit cards while traveling. While this sometimes helps a traveler avoid issues with handling local currency, it allows banks to profit from currency spreads that they dictate. These differences are spelled out in credit card agreements, and can include a ‘foreign transaction fee’ that is levied on transactions. “With the banks playing a foreign exchange spread on either end of the transaction, if one can even use their card, they are paying a significant premium,” said Scott Robinson, who, as the lead for Plug and Play Technology Center‘s bitcoin startup program, travels to many conferences searching for new ventures to invest in. In fact, those living and traveling just on bitcoin might be able to get a discount for paying in bitcoin depending on location. There are some global consumers, for instance, who may want bitcoin, but are struggling to gain access to it right now. Robinson told CoinDesk: “Bitcoin might present an environment where there is incentive to trade it for the consumer ‘exchanger’, especially in areas with low access to digital currency, which makes it much more attractive for travelers.” The killer app question Many claim Silk Road was the first killer app for bitcoin, and there are many who believe bitcoin gained popularity because of the illicit marketplace. Even so, it is arguable that global travel could become the first legitimate application for bitcoin’s payment protocol. Early adopters like Roger Ver are spending bitcoin around the world, and at the same time promoting merchant acceptance. “The technology is there, what is missing is the merchant adoption. [But] it’s always better to pay in bitcoin than have to convert your cash on each country you visit,” said BitPagos’ Serrano. Ver dismisses merchant adoption as a problem facing bitcoin travelers. He said he has great bitcoin-accepting merchants already at his disposal, and that’s enough for him: “Thanks to CheapAir, Expedia, LocalBitcoins, and ANXBTC’s bitcoin based credit card, it is completely possible to travel on bitcoins.” Travel image via Shutterstock lifestyletravel
Original author: Daniel Cawrey

Brody Precisely what the so-called “Internet of Things” will look like five or ten years from now is difficult to say, but it’s not out of the question that a block chain may be behind some of the next-generation technologies that companies like IBM are developing in order to build what may also be called the connected economy. Regardless of the phrase or buzzword, the concept envisions a world in which all devices, places and people are interconnected networks, sharing data and information at lightning speeds among one another. Mobile devices, smart appliances, vehicles, even homes – the Internet of Things may come to be known as the Internet of everything in certain areas of the world decades from now. How does the block chain – the underlying distributed ledger of the Bitcoin protocol – fit into the Internet of Things? Some see the block chain acting as the spine for a distributed network of devices, with each device acting as a miner of sorts to transmit data between all the points on the network. For IBM, which is developing its a proof-of-concept called Adept, the block chain holds the key to creating a feasible and functioning distributed network. Paul Brody, IBM vice president and North American leader for mobile and Internet of Things, told CoinDesk in a new interview that there are companies and organizations all over the world that have a real need to be able to connect devices or appliances in order to gather data. He gave an example of a health organization that used sensors placed on faucets to track hand washing rates in order to develop future policies. Yet the cost of maintaining this type of framework makes it expensive and impractical for broad deployment. Brody said that IBM began to look at other solutions that were both more cost-effective and secure. He cited security as a necessity, given the risks associated with large-scale central data control, particularly if that information is sensitive or financial-related. Brody told CoinDesk: “When we looked at those requirements and started talking to people and researching and looking at the marketplace, we saw the block chain as this potentially really powerful solution to this business problem.” Distributed future The quest to create a distributed network of devices capable of communicating with each other reliably is decades old. The Byzantine generals problem, in which a spread-out army is unable to trust its corp of separate generals given the risk of sabotage, lies at the heart of why, for many years, computing has operated around centralized structures. Brody said the block chain solves these problems by creating an environment in which only a majority (rather than all) of the nodes have to be trusted. He predicted that its ability to create large, low-cost networks will make the block chain in high demand as a technology backbone. “I think that demand for the block chain technology, the programmable ledger, autonomous distributed systems is going to be colossal,” he said. Self-regulation and maintenance is another big draw of the block chain from IBM’s perspective. Brody said the block chain can eliminate nearly all the costs of running a centralized device network structure: “As devices become smarter and smarter, why shouldn’t they be able to manage themselves? The block chain allows you to run a totally distributed platform. And by our calculation, if you use the block chain, you can cut the cost of managing a high volume device network by 99%.” Brody said that the secretive block chain project IBM is working on with Samsung is affording the two companies a deep look into exactly how this technology might work in a real-world setting. He declined to give further details, but told CoinDesk that the goal remains to have a demonstrable proof-of-concept sometime next year. Welcome to the block chain house Brody said that it’s too early to say what the practical characteristics a block chain-powered network of devices might have, but he did give a glimpse into some of the conceptual ideas IBM is playing with. He said that smart contracts or programmed transactions could be used to interact with home appliances or even to enter the residence in the first place. A smart watch may contain smart contract triggers that detect a beacon placed in the doorway that triggers the latch and opens it once the micro transaction from the watch is received on the home’s block chain. Brody explained: “My smartwatch has to have a transaction contract with my door to unlock it. That transaction has to be broadcast in the block chain so that all the devices in my block chain, that I own, recognize me and allow my watch to unlock any doors.” One problem, he continued, lies in the speed of transactions. A homeowner wouldn’t want to wait five minutes in order to unlock their door or turn on a light every time they come and go. Brody said that one solution IBM could use involves programming a home’s “family of devices” to remember the source of a smart contract. Making the Internet smarter Brody said repeatedly that the goal is to build a smarter network of devices that are capable of sharing energy and bandwidth, making decisions and squeezing every ounce of efficiency out of themselves during operation. He explained: “Transaction processing is the foundational workload of all modern computing. Tweets, likes, airline reservations, utility bills — they’re all transactions. On the block foundation level, we can do more than just infrastructure, we can write applications.” From there, one can create autonomous systems that operate in tandem, capable of making collective decisions based on an operational need. Using a washing machine as an example, he said that smart appliances can receive data from an outside source and adjust their power consumption or change their settings in order to be more efficient. Brody added that it’s feasible that hundreds of billions of devices could one day be connected on a single block chain or network of block chains, all of which communicate with each other via automated transactions. He envisioned an ecosystem of both centralized and decentralized systems based on security needs, but ultimately, pushing automated system intelligence to new heights. Image via Shutterstock, YouTube Block ChainIBMSamsung
Original author: Stan Higgins

Russian Ministry of Finance The Ministry of Finance of the Russian Federation has released the full version of the draft bill that, if passed in current form, would effectively ban the creation and distribution of software that allows for the use of money substitutes, including bitcoin and all digital currencies. First announced as a proposal in August, the news marks the first time that the Ministry of Finance has made the proposed law public, as well as its definition of “money surrogates” under which bitcoin and digital currencies may be prohibited. The two-page draft bill details a series of administrative fines to be imposed on both businesses and private citizens who issue, create or deliberately disseminate information about the release or operation of digital currencies, the language implying that the law would apply to much of the bitcoin industry, from bitcoin users to miners and service providers. For example, individuals who are found to issue or create bitcoin or digital currencies will be penalized with fines of 30,000–50,000 rubles ($750–$1,250). Similarly, officials found to engage in such practices will be subject to fines of 60,000–100,000 rubles ($1,500–$2,500), while legal entities will be eligible for fines of 500,000–1m rubles ($12,500–$25,000). A similar series of fines is also detailed for those found to have disseminated information that “permits the release of money substitutes”. Individuals engaging in this practice would be subject to fines 5,000–50,000 rubles ($125–$12,50); officials, 20,000–100,000 rubles ($500–$2,500); and legal entities 500,000–1m rubles ($12,500–$25,000). At press time, much of the domestic industry was still reacting to the news. Anton Vereshchagin, founder of InterMoneyExchange, which had planned to launch in Russia but has since moved to other markets, told CoinDesk: “If earlier Central Bank statements suggested Russia would follow the FATF and other recommendations and regulate bitcoins, now it seems that the chances are very very small.” He added: “In fact, the restrictions and prohibitions are only getting worse.” Amended definitions The draft bill also calls for the amendment of the definition of money surrogates in Russia to include language that would cover new financial technologies such as digital currencies. Under the revision, the definition would include any “monetary unit” issued as a means of payment or exchange and not allowed under federal law. The law would also be revised so that those who promote or encourage such activities are also in violation of the law. One provision calls for the law to be amended to “prohibit the dissemination of information that permits release (emission) of money substitutes and (or) the operation with their use.” Confirming fears The latest language in the draft bill confirms fears long harbored by many other Russian market observers. Артем Толкачев, a managing partner at the law firm Толкачев и Партнеры, who has spoken publicly at Russian bitcoin conferences and who advises bitcoin startups on local regulation, told CoinDesk in September that he was pessimistic the law might only apply to those seeking to exchange fiat money for digital currencies. In particular, Толкачев pointed to statements from the Ministry of Finance in September that suggested the bill might make this interpretation. The statement read: “We are not going to prohibit people to play checkers and to call checkers money. What we prohibit is to exchange substitutes to money and vice versa.” Толкачев also pointed to the gradual evolution in statements from Russian authorities as well as the milder positions of the Bank of Russia, the country’s central bank. Image via Shutterstock Russia
Original author: Pete Rizzo

Michael Terpin is a serial entrepreneur in marketing and cryptocurrency. His bitcoin endeavors include BitAngels, Bitcoin Syndicate and CoinAgenda. In this article, he looks back on his journey in the bitcoin industry since he first got involved in May 2013. sky not falling bitcoin It’s been a little over 16 months since I first set foot in my first bitcoin convention in late May 2013. As I’d noted in a socalTECH post right after I returned, I thought bitcoin and cryptocurrency was poised to grow dramatically, disrupt economies and increase in value. It was $120 per bitcoin way back then, down from its “all-time high” barely a month earlier of $266. The price of bitcoin continued on its downward slope for much of the summer of 2013, weathering such controversies as “would California make the Bitcoin Foundation register as a money transmitter” (no) and “what can you buy with bitcoins” (not very much back then). I accurately called the 2013 bottom last July at $70, but I couldn’t convince my wife to buy 1,000 bitcoins at that price, instead using it as a down payment on a piece of Las Vegas real estate (the rental home we ended up buying is up about 20% in value; the price of bitcoins even at current prices would have been up 500%). Welcome to a mercurial market. Flash forward to today. I’ve gone from wide-eyed newbie in the cryptocurrency world to a recognized name on the bitcoin conference circuit (I even started my own conference in conjunction with the angel investor network I started last year, BitAngels, and today we announced 20 startup companies who will be pitching bitcoin investors at the event, CoinAgenda, which takes place next week at the Palms Fantasy Tower in Las Vegas. (Humor note: Yes, we’re holding a conference about investing in so-called “magic Internet money” at a place called the Fantasy Tower…). What’s not fantasy is how the traditional VC world has woken up to the promise of cryptocurrency and the block chain (the technology upon which bitcoin, as well as other coins using a similar architecture, is built). According to CoinDesk, VC investments in cryptocurrency startups rose from $2.1m in 2012 to $91.8m in 2013. Thus far in 2014, there has been $191m in venture capital investments into cryptocurrency companies – and that number doesn’t include roughly $30m that has been raised by new coins like Ethereum, Maidsafe and Swarm using cryptoequity crowdsales (disclosure: my PR firm, Transform, worked with MaidSafe and Swarm to help them raise $6m and $1m, respectively; Ethereum, who we advised in the beginning but did not work with during the actual crowdsale, raised about $18m in 42 days). Most of these cryptoequity fundings for new coins took place in 2014. So what are the lessons to be learned from the last 16 months? Here’s my take: (1) Bitcoin price will remain turbulent, but that’s part of the opportunity. LA-based investment bank Wedbush Securities issued a report six weeks ago where they forecast a 50% likelihood of bitcoin returning to $1,000 or higher (with 0.5% forecast of $1 million per bitcoin), along with a 50% outlook it will go to zero. While this sounds like “flip a coin,” Wedbush report author Gil Luria (who will be keynoting at the Inside Bitcoins conference in Las Vegas next week, which takes place just prior to CoinAgenda) says “the trader in me tells me that positive progress over the next 12 months should get bitcoin back to $1000”. (2) Merchant acceptance speeds adoption, but actually has a downward effect on price. This is because most merchants who accept bitcoin do it for a combination of wanting lower fees (as low as zero) and taking away the risk of chargebacks, because each payment is final and irreversible. What few merchants or retailers do is keep the bitcoins (Overstock.com is a notable exception, keeping as much as 10% and encouraging employees and vendors to accept bitcoin from them), and that means that millions of dollars per month taken in by Dell, DirecTV, Gyft (which lets users purchase gift cards for bitcoins from 200 merchants, including Amazon and Home Depot) and Expedia are effectively sell orders. Selling drives down price. (3) Prices will rise again when more investors want to buy. What drove the prices up 1000% or more (three times in the past three years) has been investor demand. In early 2013, it was triggered by people in Cyprus buying bitcoins to move money out of the country as banks started tacking on a wealth tax. In late 2013, it was a combination of new Chinese bitcoin exchanges attracting new Asian investors (also in part to get money out of a restrictive monetary regime), as well as a few small funds that bought bitcoins on behalf of accredited investors. As 2014 closes out, there is a public vehicle (already reserved as NASDAQ: COIN) owned by the Winklevoss twins of early Facebook fame that is awaiting final regulatory approval to be the first bitcoin ETF that anyone (not just accredited investors) can buy. Since there is a fixed number of bitcoins, buying makes the price go up, which results in more investor interest, which makes the price go up again until enough profit has been taken by those early in the cycle that the bubble pops – until the cycle repeats again from a higher bottom. I’m a firm believer we will see this happen again in the next 12 months. (4) Bitcoin and cryptocurrency companies, while a small portion of all venture capital and angel funding, are growing fast and LA is one of the hotbeds. The staggering growth numbers are mentioned at the start of this piece, and several of those funded are based in Silicon Beach:Gem, GoCoin, Expresscoin and FreshPay are just the first wave of companies started in Santa Monica/Venice to be incubated, funded and launch products. Moreover, of the top 10 investor syndicates on AngelList, two of them are specializing in bitcoin company investments (as is #11). Both of these have Santa Monica ties: Brock Pierce’s syndicate (#8) recently passed $1 million in per-deal commitments and the syndicate that I co-manage with Gil Penchina and Nick Sullivan just passed $800,000 in less than two months of existence. Our syndicates have each completed two deals. So that’s my bitcoin update as we enter Q4 2014. I’ll be back again next year unless something dramatic (good or bad) unfolds in the meantime. This article has been republished here with permission from the author. Originally published on socaltech.com. Disclaimer: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, CoinDesk. Silver lining image via Shutterstock BitAngelsMichael Terpin
Original author: Michael Terpin

Ross Ulbricht was arrested in October 2013, with the FBI accusing him of being behind the dark web site Silk Road. He has been charged with narcotics trafficking, computer hacking and money laundering. Click below to view an interactive timeline of Ulbricht’s legal battle. This article is part of CoinDesk’s Silk Road: One Year On series. Keep checking back for new additions to the series. Calendar image via Shutterstock. Ross Ulbrichttimelines
Original author: CoinDesk

Epiphyte Crypto-finance company Epiphyte has won the SWIFT Innotribe Startup Competition at the Sibos 2014 technology and innovation trade show in Boston. The company earned the competition’s $50,000 ‘Top Startup’ award with cBridge, its first crypto product targeted at international banking and financial institutions. Epiphyte CEO and founder Edan Yago said it was “very gratifying” to win the prize at the world’s largest banking convention. He added that banks, bitcoin and other distributed ledger systems have a lot to learn from each other. Epiphyte specialises in distributed ledger solutions for the mainstream financial system with the broader goal of connecting banking networks with cryptocurrency networks. Following the win, Yago said: “We have spent the last year and a half working with banks to help them integrate distributed ledger and block chain based technologies in a low-risk and compliant way. We are building the bridge between established finance and cryptofinance.” Block chain tech for banks Epiphyte’s cBridge beat out 280 competing FinTech startups. The criteria were simple: judges were asked to determine the likeliest startup to have the biggest impact on the future of the financial industry. Each of the semi-finalists pitched their ideas to audiences that would decide which of the startups would be invited to the Sibos Grand Finale at Sibos for global exposure and receive the cash prize. Kevin Johnson, SWIFT Innotribe Startup Challenge manager, suggested that while his product may have sold itself, Yago’s pitch to the attendees was equally compelling, saying: “I feel Epiphyte’s pitch at the startup competition was voted by the audience as the winner, due to the connection he made to the audience, showing how they can benefit from this technology and the business model.” Epiphyte technology allows banks to facilitate consumer-to-merchant payments using cryptocurrencies. Bank customers can perform the transactions in familiar fiat currencies like dollars and euros, and the banks themselves do not have to hold cryptocurrencies. New payment rail Jo Lang, Epiphyte’s product lead and co-founder, said as many as 500 million bank customers are now able to make purchases using this new payment rail. “Epiphyte is helping our banking customers see additional revenue by providing a service that a growing number of customers want,” said Lang. The solution was designed to offer a low level of risk and compliance. Banks can use Epiphyte software to integrate crptocurrencies with traditional protocols like SWIFT. The company, founded in 2013, plans to roll out a pilot implementation of its new product sometime in the next few months. This article was co-authored by Stan Higgins Images via Epiphyte; Shutterstock Sibos
Original author: Nermin Hajdarbegovic
  1. Ross Ulbricht: Hero or Villain?
  2. Bitcoin Could Transform Internet of Things into Vast Data Marketplace
  3. Silk Road Timeline
  4. Silk Road: One Year On

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